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Is there any organizational practice more broken than performance management? Not if you concur with Marc Effron & Miriam Ort who state “perhaps no talent management process is more important or more reviled than performance management.” In fact, it draws universal agreement on several fronts:

everyone hates it – employees and managers alike

nobody does it well – it’s a skill that seemingly fails to be acquired despite exhaustive training efforts, and

it fails the test of construct validity – it doesn’t do what it was designed to do, i.e. increase performance

Traditional performance management programs have become organization wallpaper. They exist in the background with little or no expectations for impact. Yet despite its poor popularity, the concept of performance (at an individual and organizational level) is critical to business success. It can’t just be ignored.

Why is it so broken?

In a large survey conducted by WorldatWork, 58% of organizations rated their performance management systems as “C Grade or below.” That gets a giggle. The performance management process itself gets subjected to its own methods of setting criteria and rating performance against them – and fails.

I believe there are three reasons almost all current performance management systems are broken:

1 People have changed

2 Technology has changed

3 People’s relationship with their technology has changed

Repairing the damage? In order to compete in today’s market, companies must move to adopt a much more agile performance management approach.

People HAVE CHANGED

Employee expectations have changed. It’s not just Gen Y – employees everywhere and of every generation expect more. More involvement, more accountability, and more transparency. When it comes to managing their performance, employees have shifted from being passive recipients to active agents. Not satisfied with a one-way download of performance feedback, employees want to participate in the performance data collection process. And they liken the ‘annual event’ of a performance review to arriving at the pearly gates on Judgment Day.

Managers have changed too. Command and control is no longer cutting it – managers are expected to guide and coach, provide balanced constructive feedback and inspire, rather than enforce, performance.

2) set stretch goals and inspire individuals to work to their potential.

3) get out of the way - trust their teams and empower employees with accountability.

Technology HAS CHANGED

We’re reaching a tipping point for technology in the talent management arena. It began with simple automation: take the paper processes and put them on a computer. Fine, but that left us with so many spreadsheets, Word templates, proprietary systems and disconnected point solutions that we were drowning in complexity and data overload. It also highlighted that many of the processes we were automating actually needed to be revised, simplified or eliminated altogether.

Baffled by the complexity we created, focus in recent years has been on process simplification, user-friendliness and redirecting attention to what actually matters. A good step forward, but we still suffer from too much data, too little meaningful information.